Economy

Economy—overview: One of the poorest countries of central Europe Bulgaria has slowly been moving from its old command economy towards a market-oriented economy. The economy faced a major crisis in 1996 marked by a banking system in turmoil a depreciating currency and contracting production and foreign trade. Foreign exchange reserves dwindled to $518 million while dramatically hiked interest rates added to the domestic debt burden and stifled growth. GDP fell by 11% in 1996 after experiencing 2.0% growth in 1995. Privatization of state-owned industries stagnated although the first auction of a mass privatization program was undertaken in late 1996. Lagging progress on structural reforms led to postponement of IMF disbursements under a $580 million standby loan agreed to in July 1996. In November 1996 the IMF proposed a currency board as Bulgaria's best chance to restore confidence in the lev eliminate unnecessary spending and avoid hyperinflation. The board was set up on 1 July 1997. Its establishment was followed by a reduction in inflation and interest rates and by a rise in foreign investment. Simultaneously the government pledged to sell off some of the most attractive state assets. GDP in 1997 dropped 7.4% but is expected to rebound to an estimated 2% in 1998. Other government objectives include: the completion of land reform the privatization and strengthening of the banking system and the modernization of the legal environment of business.

GDP: purchasing power parity—$57.13 billion (2004 est.)

GDP—real growth rate: 4.3% (2004 est.)

GDP—per capita: purchasing power parity—$7,600 (2004 est.)

GDP—composition by sector:

agriculture: 11.4%

industry: 30%

services: 58.6% (1997 est.)

Inflation rate—consumer price index: 3% (2004 est.)

Labor force:

total: 3.33 million (2004 est.)

by occupation: industry 31% agriculture 26% other 43% (1998)

Unemployment rate: 14.3% (2004 est.)

Budget:

revenues: $8.121

expenditures: $8.121 including capital expenditures of $NA (2004 est.)

Industries: electricity, gas and water; food, beverages and tobacco; machinery and equipment, base metals, chemical products, coke, refined petroleum, nuclear fuel

Industrial production growth rate: 6.3% 2004 est.)

Electricity—capacity: 12.087 million kW (1995)

Electricity—production: 41.38 billion kWh (1995)

Electricity—consumption : 32.52 billion kWh (2001)

Agriculture—products: vegetables, fruits, tobacco, livestock, wine, wheat, barley, sunflowers, sugar beets, livestock

Exports:

total value: $7.337 billion f.o.b. (2004 est.)

commodities: machinery and equipment 15.2%; agriculture and food 18.9%; textiles and apparel 14.8%; metals minerals and fuels 26.5%; chemicals and plastics 20%; other 4.6% (1996)

partners: Italy 14.1%, Germany 10.9%, Greece 10.5%, Turkey 9.2%, France 5.1%, US 4.5% (2003)

Imports:

total value: $9.723 billion f.o.b. (2003 est.)

commodities: fuels minerals and raw materials 40.7%; machinery and equipment 18.4%; textiles and apparel 11.6%; agricultural products 7.5%; metals and ores 5.2%; chemicals and plastics 12.2%; other 4.4% (1996)

partners: Germany 14.4%, Russia 12.6%, Italy 10.3%, Greece 6.7%, Turkey 6.2%, France 5.7% (2003)

Debt—external: $12.05 billion (2004 est.)

Economic aid - recipient: $300 million (2000 est.)

Currency: 1 lev (Lv) = 100 stotinki

Exchange rates: leva per US dollar - 1.5123 (2005), 1.7327 (2003), 2.077 (2002), 2.1847 (2001), 2.1233 (2000), 1.8364 (1999) note: on 5 July 1999, the lev was redenominated; the post-5 July 1999 lev is equal to 1,000 of the pre-5 July 1999 lev

Fiscal year: calendar year